Acquisitions, markups, efficiency, and product quality: Evidence from India

• 成果类型: Article
• 署名作者: Stiebale, Joel; Vencappa, Dev
• 署名单位: Heinrich Heine University Dusseldorf; Aston University
• 刊物名称: JOURNAL OF INTERNATIONAL ECONOMICS
• ISSN/ISSBN: 0022-1996
• DOI: 10.1016/j.jinteco.2018.02.005
• 发表日期: 2018
• 页码: 70-87
• 关键词: Foreign ownership; Mergers and Acquisitions; Multi-product firms; PRODUCTIVITY; markups; product quality

摘要

This paper uses a rich panel data set of Indian manufacturing firms to analyze the effects of domestic and international acquisitions on various outcomes at target firm and product level. We apply recent methodological advances in the estimation of production functions together with information on prices and quantities to estimate physical productivity, markups, marginal costs and proxies for product quality. Using a propensity score reweighting estimator, we find that acquisitions are associated with increases in quantities and markups and lower marginal costs on average. These changes are most pronounced if acquirers are located in technologically advanced countries. We also provide evidence that the quality of products increases while quality-adjusted prices fall upon acquisitions. Our results indicate that knowledge transfer from foreign acquirers to domestic firms, predicted by theories of multinational firms, can materialize in both cost- and quality-based gains and benefit both firms and consumers. (C) 2018 Elsevier B.V. All rights reserved.